Lower tax rates make tax-deferred retirement plans
less appealing, especially given the prospect of higher tax rates prevailing in the future.
Moreover, lower tax rates make traditional 401(k) and other tax-deferred retirement plans
While a majority (88%) of high net worth consumers ages 65-75 are familiar with RMD rules on tax-deferred retirement plans
, a full 80% of these respondents believe they will not need all of their RMDs for day-to-day living expenses, according to the new RMD Options Study from Allianz Life Insurance Company of North America (Allianz Life).
The same Internal Revenue Code that allowed you to save tax dollars when you contributed to those tax-deferred retirement plans
also generally requires you to begin withdrawals on the year you reach age 70%.
Despite the popularity of tax-deferred retirement plans
for both traditionally and self-employed savers, some advisors like to steer clear.
The Wall Street Journal reported that the government has estimated that it lost $136,000,000,000 in revenue to tax-deferred retirement plans
They are a leading provider of 403(b) and 457(b) tax-deferred retirement plans
, primarily in the K-12 school marketplace.
70 1/2--You must start taking minimum distributions from most tax-deferred retirement plans
or face a 50% penalty on the amount that should have been withdrawn.
The first new 403(b) regulations in 40 years will increase employers' role as sponsors of these tax-deferred retirement plans
, with respect to investments, transfers, documentation, plan administration, and participant disclosures, according to Lincoln Financial Group.
In the meantime, contribute the maximum amount possible to your employer's retirement or 401(k) tax-deferred retirement plans
. These are funded with pretax dollars and many employers will match part of the employee contribution making them a win-win offering.
It discusses the characteristics of each of the various tax-deferred retirement plans
, and which works best for individuals in different scenarios.
Putting money aside in tax-deferred retirement plans
is another top priority even for those who are in debt.